OPEC Aims for Modest Output Hike to Overcome Iran's Dissent - Bloomberg:
"OPEC is discussing a relatively modest production increase before its meeting in Vienna this week, an attempt to bridge the gap between Russia’s push for a big rise and Iran’s insistence that no change is needed.
While a compromise may be necessary to overcome vocal opposition from Tehran, Baghdad and Caracas, it could mean the resulting supply boost is smaller than oil traders -- or indeed the U.S. President Donald Trump -- had been anticipating. Crude prices rallied in London on Monday after two weeks of losses, trading above $74 a barrel.
Members of the Organization of Petroleum Exporting Countries are discussing an agreement that delivers 300,000 to 600,000 barrels a day of additional oil supply to global markets over the next few months, according to people briefed on the talks. If agreed, that would be smaller than the 1.5 million-barrel-a-day quota increase that Russia has proposed."
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Monday, 18 June 2018
Abu Dhabi stimulus confirms fiscal adjustment is over: Fitch | ZAWYA MENA Edition
Abu Dhabi stimulus confirms fiscal adjustment is over: Fitch | ZAWYA MENA Edition:
"Abu Dhabi's new economic stimulus programme will have limited sovereign credit impact given the sovereign's strong balance sheet and low fiscal break-even oil price, Fitch Ratings says. But it highlights the winding down of fiscal adjustment and suggests that the fiscal policy-making framework has seen little improvement during the period of low oil prices, despite sharp spending cuts and increases in non-oil revenue.
Sheikh Mohammed bin Zayed, Abu Dhabi's crown prince, earlier this month approved a three-year stimulus package worth AED50 billion (USD13.6 billion), or around 6% of Abu Dhabi GDP. Objectives include job creation, increasing tourism, and improving private sector development. Full details have yet to be set out and government departments will spend the next three months preparing their spending plans. To support the private sector and attract investment, they have also been instructed to speed up payments to private sector suppliers and ease licensing requirements and regulations for companies.
Abu Dhabi's fiscal break-even oil price is among the lowest for Fitch-rated oil producers, estimated at slightly above USD60/bbl, and its fiscal and external positions are among the strongest, with sovereign net foreign assets estimated at 281% of GDP last year, and government debt at just 8% of GDP."
'via Blog this'
"Abu Dhabi's new economic stimulus programme will have limited sovereign credit impact given the sovereign's strong balance sheet and low fiscal break-even oil price, Fitch Ratings says. But it highlights the winding down of fiscal adjustment and suggests that the fiscal policy-making framework has seen little improvement during the period of low oil prices, despite sharp spending cuts and increases in non-oil revenue.
Sheikh Mohammed bin Zayed, Abu Dhabi's crown prince, earlier this month approved a three-year stimulus package worth AED50 billion (USD13.6 billion), or around 6% of Abu Dhabi GDP. Objectives include job creation, increasing tourism, and improving private sector development. Full details have yet to be set out and government departments will spend the next three months preparing their spending plans. To support the private sector and attract investment, they have also been instructed to speed up payments to private sector suppliers and ease licensing requirements and regulations for companies.
Abu Dhabi's fiscal break-even oil price is among the lowest for Fitch-rated oil producers, estimated at slightly above USD60/bbl, and its fiscal and external positions are among the strongest, with sovereign net foreign assets estimated at 281% of GDP last year, and government debt at just 8% of GDP."
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Bahrain’s credit default swaps surpass 2016 peak when oil cost $30 per barrel | Reuters
Bahrain’s credit default swaps surpass 2016 peak when oil cost $30 per barrel | Reuters:
"The cost of insuring Bahrain’s sovereign debt against default is at an historical high, amid continuing concerns over the country’s ability to tap international markets to stave off a potential financial crisis. Bahrain’s credit default swaps went up to 413 basis points last week, surpassing previous peaks of 412 basis points in February 2016, when oil prices were at around $30 per barrel, and a peak of around 400 basis points in early 2012, in the aftermath of the political uprising of the previous year. A decline in oil prices over the past few weeks, from around $80 per barrel in mid-May to $74 on Sunday, has lifted the CDS of Saudi Arabia and Qatar by 7 bps and 10 bps, respectively. Bahrain’s CDS soared 82 points since mid-May."
'via Blog this'
"The cost of insuring Bahrain’s sovereign debt against default is at an historical high, amid continuing concerns over the country’s ability to tap international markets to stave off a potential financial crisis. Bahrain’s credit default swaps went up to 413 basis points last week, surpassing previous peaks of 412 basis points in February 2016, when oil prices were at around $30 per barrel, and a peak of around 400 basis points in early 2012, in the aftermath of the political uprising of the previous year. A decline in oil prices over the past few weeks, from around $80 per barrel in mid-May to $74 on Sunday, has lifted the CDS of Saudi Arabia and Qatar by 7 bps and 10 bps, respectively. Bahrain’s CDS soared 82 points since mid-May."
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Franklin Templeton funds get QFI status in Saudi Arabia | Reuters
Franklin Templeton funds get QFI status in Saudi Arabia | Reuters:
"Franklin Templeton funds have become qualified foreign investors (QFI) in Saudi Arabia, which will allow them to invest directly in Riyadh’s stock market, the U.S. fund manager said on Monday.
The approval comes as Saudi Arabia implements a far reaching economic transformation program aimed at stimulating growth and employment, it said in a statement.
In March global index compiler FTSE Russell decided to upgrade Saudi Arabia to emerging market status, and MSCI is widely expected to make a similar decision in June."
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"Franklin Templeton funds have become qualified foreign investors (QFI) in Saudi Arabia, which will allow them to invest directly in Riyadh’s stock market, the U.S. fund manager said on Monday.
The approval comes as Saudi Arabia implements a far reaching economic transformation program aimed at stimulating growth and employment, it said in a statement.
In March global index compiler FTSE Russell decided to upgrade Saudi Arabia to emerging market status, and MSCI is widely expected to make a similar decision in June."
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Air Arabia says working to protect its investment in Abraaj | Reuters
Air Arabia says working to protect its investment in Abraaj | Reuters:
"Dubai-listed Air Arabia said on Monday it has an investment in Abraaj funds, without elaborating further on its exposure to the private equity group which last week filed an application for provisional liquidation.
Abraaj’s founder Arif Naqvi is a board director of the Middle East low-cost carrier, according to Air Arabia’s website.
The airline said it has appointed a team of experts who are “actively engaged with all stakeholders and creditors involved with the matter to ensure Air Arabia’s investment and business interest is protected.”"
'via Blog this'
"Dubai-listed Air Arabia said on Monday it has an investment in Abraaj funds, without elaborating further on its exposure to the private equity group which last week filed an application for provisional liquidation.
Abraaj’s founder Arif Naqvi is a board director of the Middle East low-cost carrier, according to Air Arabia’s website.
The airline said it has appointed a team of experts who are “actively engaged with all stakeholders and creditors involved with the matter to ensure Air Arabia’s investment and business interest is protected.”"
'via Blog this'
UAE energy minister says oil market moving ever closer to becoming rebalanced | Reuters
UAE energy minister says oil market moving ever closer to becoming rebalanced | Reuters:
"United Arab Emirates’ Energy Minister Suhail Al- Mazrouei said on Monday that the oil market is moving closer to rebalancing, according to a statement sent by his ministry.
Mazrouei, who holds the OPEC presidency in 2018, also said he acknowledged concerns expressed by some countries regarding potential shortages in the global oil market.
“Looking ahead, I remain optimistic that we will fulfil our goal of delivering sustainable oil market stability, which is intended to serve the long-term interests of producers, consumers and the global economy,” he said."
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"United Arab Emirates’ Energy Minister Suhail Al- Mazrouei said on Monday that the oil market is moving closer to rebalancing, according to a statement sent by his ministry.
Mazrouei, who holds the OPEC presidency in 2018, also said he acknowledged concerns expressed by some countries regarding potential shortages in the global oil market.
“Looking ahead, I remain optimistic that we will fulfil our goal of delivering sustainable oil market stability, which is intended to serve the long-term interests of producers, consumers and the global economy,” he said."
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Saudi Arabia, Russia seek 1.5 million bpd OPEC, non-OPEC output increase: Ecuador | Reuters
Saudi Arabia, Russia seek 1.5 million bpd OPEC, non-OPEC output increase: Ecuador | Reuters:
"Russia and Saudi Arabia have put forward a proposal to increase production by OPEC and non-OPEC countries by 1.5 million barrels per day, Ecuador’s oil minister said on Monday.
Perez said on his arrival in Vienna for the meeting of the Organization of the Petroleum Exporting Countries that this was the only proposal he has seen being put forward, and that the proposed increase would be from the quota that the members of the deal had agreed on.
OPEC’s second and third largest producers Iraq and Iran have said they would oppose steep output increases as it would breach previous agreements to keep production cuts in place until the end of the year. "
'via Blog this'
"Russia and Saudi Arabia have put forward a proposal to increase production by OPEC and non-OPEC countries by 1.5 million barrels per day, Ecuador’s oil minister said on Monday.
Perez said on his arrival in Vienna for the meeting of the Organization of the Petroleum Exporting Countries that this was the only proposal he has seen being put forward, and that the proposed increase would be from the quota that the members of the deal had agreed on.
OPEC’s second and third largest producers Iraq and Iran have said they would oppose steep output increases as it would breach previous agreements to keep production cuts in place until the end of the year. "
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MIDEAST STOCKS-Air Arabia drops in Dubai on Abraaj links, most Abu Dhabi banks down | Reuters
MIDEAST STOCKS-Air Arabia drops in Dubai on Abraaj links, most Abu Dhabi banks down | Reuters:
"Stock exchanges in Dubai and Abu Dhabi closed in negative territory on Monday, reflecting a slump in global stocks and oil prices due to increasing trade tensions.
Markets in the rest of the region were closed because of the Eid holiday, which started last week.
U.S. President Donald Trump announced tariffs on Chinese imports, prompting Beijing to respond with similar measures."
'via Blog this'
"Stock exchanges in Dubai and Abu Dhabi closed in negative territory on Monday, reflecting a slump in global stocks and oil prices due to increasing trade tensions.
Markets in the rest of the region were closed because of the Eid holiday, which started last week.
U.S. President Donald Trump announced tariffs on Chinese imports, prompting Beijing to respond with similar measures."
'via Blog this'
How to Spend a $210 Billion Oil Windfall - Bloomberg
How to Spend a $210 Billion Oil Windfall - Bloomberg:
"The significant rise in oil prices over the past year has big implications for the Middle East and North Africa (MENA), where hydrocarbons still play a pivotal role in the economy. Despite this change, it’s imperative that countries in the region stay resolved to cut their dependence on oil and make their economies more diverse and resilient. Just a year ago, crude was trading below $50 a barrel, amid stories of oversupply and tumbling prices. Today, it is pushing closer to $80 – a level not seen since 2014. It’s the strongest rally since 2011, the last time prices jumped by 60 percent in less than a year. So what impact does this have on MENA countries, and how should they respond? For most oil-exporting nations, higher crude prices mean windfall export and fiscal revenues. We estimate that MENA oil exporters will earn about $210 billion more in 2018-19 than they would have if oil prices had stayed at 2017 levels. Higher prices will probably boost confidence, helping spur growth and investment in non-oil industries – although heightened geopolitical risk could dampen that optimism."
'via Blog this'
"The significant rise in oil prices over the past year has big implications for the Middle East and North Africa (MENA), where hydrocarbons still play a pivotal role in the economy. Despite this change, it’s imperative that countries in the region stay resolved to cut their dependence on oil and make their economies more diverse and resilient. Just a year ago, crude was trading below $50 a barrel, amid stories of oversupply and tumbling prices. Today, it is pushing closer to $80 – a level not seen since 2014. It’s the strongest rally since 2011, the last time prices jumped by 60 percent in less than a year. So what impact does this have on MENA countries, and how should they respond? For most oil-exporting nations, higher crude prices mean windfall export and fiscal revenues. We estimate that MENA oil exporters will earn about $210 billion more in 2018-19 than they would have if oil prices had stayed at 2017 levels. Higher prices will probably boost confidence, helping spur growth and investment in non-oil industries – although heightened geopolitical risk could dampen that optimism."
'via Blog this'
Oil Slumps Near $64 as OPEC Clash Looms and Trade War Escalates - Bloomberg
Oil Slumps Near $64 as OPEC Clash Looms and Trade War Escalates - Bloomberg:
"Oil fell near $64 a barrel as Saudi Arabia and Russia prepared for a clash with allied crude producers over whether to lift output and as China and the U.S. exchanged threats over trade. Futures in New York dropped as much as 2.3 percent, on course for the lowest close since April 9 after a 2.7 percent decline Friday. Iran says Venezuela and Iraq will join in blocking a proposal to increase production that’s backed by Saudi Arabia and Russia when OPEC and its allies meet in Vienna this week. China said it would impose tariffs on a variety of U.S. goods, including crude and gasoline, in response to President Donald Trump’s $50 billion levy on Chinese imports. Crude has dropped more than 10 percent from its high in May amid signs Saudi Arabia and Russia are seeking to lift output curbs that have eliminated a global surplus and boosted prices. Meanwhile, traders are trying to digest the impact from both the U.S. and China issuing tariffs on goods and the threat of a broader trade war between the world’s two largest economies. "
'via Blog this'
"Oil fell near $64 a barrel as Saudi Arabia and Russia prepared for a clash with allied crude producers over whether to lift output and as China and the U.S. exchanged threats over trade. Futures in New York dropped as much as 2.3 percent, on course for the lowest close since April 9 after a 2.7 percent decline Friday. Iran says Venezuela and Iraq will join in blocking a proposal to increase production that’s backed by Saudi Arabia and Russia when OPEC and its allies meet in Vienna this week. China said it would impose tariffs on a variety of U.S. goods, including crude and gasoline, in response to President Donald Trump’s $50 billion levy on Chinese imports. Crude has dropped more than 10 percent from its high in May amid signs Saudi Arabia and Russia are seeking to lift output curbs that have eliminated a global surplus and boosted prices. Meanwhile, traders are trying to digest the impact from both the U.S. and China issuing tariffs on goods and the threat of a broader trade war between the world’s two largest economies. "
'via Blog this'
Luring Investors: Dubai developers campaign hard to sell unsold stock | ZAWYA MENA Edition
Luring Investors: Dubai developers campaign hard to sell unsold stock | ZAWYA MENA Edition:
"Developers in Dubai are pulling out all the stops to attract end-users/investors to their unsold stock. This is resulting in some ingenious sales schemes. As a result, even the traditionally quiet period of the holy month of Ramadan has seen active sales campaigns from developers and their broker partners in ready-to-handover communities. If the estimated 15,000 to 18,000 units make it to the Dubai market by the end of this year, new demand has to be created. The proposed 10-year residency visa announcement is one among several such methods devised to create such demand among end-users. As stretching post-handover payment plans seems to have reached a saturation point, developers are enticing end-users to buy ready property with no down payment, waiver of service charges for several years after handover, waiver of the Dubai Land Department (DLD) registration fees, no agent commission and more."
'via Blog this'
"Developers in Dubai are pulling out all the stops to attract end-users/investors to their unsold stock. This is resulting in some ingenious sales schemes. As a result, even the traditionally quiet period of the holy month of Ramadan has seen active sales campaigns from developers and their broker partners in ready-to-handover communities. If the estimated 15,000 to 18,000 units make it to the Dubai market by the end of this year, new demand has to be created. The proposed 10-year residency visa announcement is one among several such methods devised to create such demand among end-users. As stretching post-handover payment plans seems to have reached a saturation point, developers are enticing end-users to buy ready property with no down payment, waiver of service charges for several years after handover, waiver of the Dubai Land Department (DLD) registration fees, no agent commission and more."
'via Blog this'
MIDEAST STOCKS-Waha Capital down in Abu Dhabi, Air Arabia drops in Dubai | Reuters
MIDEAST STOCKS-Waha Capital down in Abu Dhabi, Air Arabia drops in Dubai | Reuters:
"Amid muted trading activity, the Abu Dhabi stock market shed value in early trade on Monday, mirroring a drop in Asian shares, while Dubai was flat.
Markets in Saudi Arabia and Qatar were closed because of the Eid holiday, which started last week.
U.S. President Donald Trump fuelled trade tensions by going ahead with tariffs on Chinese imports, prompting Beijing to immediately respond in kind. Asian shares were down on Monday and oil prices came under pressure, in particular after China threatened duties on American crude imports."
'via Blog this'
"Amid muted trading activity, the Abu Dhabi stock market shed value in early trade on Monday, mirroring a drop in Asian shares, while Dubai was flat.
Markets in Saudi Arabia and Qatar were closed because of the Eid holiday, which started last week.
U.S. President Donald Trump fuelled trade tensions by going ahead with tariffs on Chinese imports, prompting Beijing to immediately respond in kind. Asian shares were down on Monday and oil prices came under pressure, in particular after China threatened duties on American crude imports."
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